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August 08, 2006

Cambridge University Press buys 51% stake in Indian publisher, Foundation Books, for US$ 6.5 million

In July, Cambridge University Press (CUP) bought a 51% stake (for about US$ 6.5 million) in Indian publisher, Foundation Books, with $4.5 million going to Manas Saikia, owner of Foundation Books, and $2 million to be invested by CUP in the Indian business going ahead.

Various news reports throw light on the reasons for the deal and CUP's plans in India.

Cambridge University Press has entered India through the acquisition of 51 per cent stake in Foundation Books Pvt Ltd together with its divisions Foundation Media and Foundation e-Learning for about $6 million. The new entity will be called Cambridge University Press India Pvt Ltd. "India will become a base for publishing quality educational materials for us for many of our Asian and other markets. We plan to take the number of offices to 12 from the existing six in about five years. We also plan to increase the headcount to 200 from the current 80 in about the same time," said Mr Stephen Bourne, President, CUP. It publishes around 2,500 new titles and 200 journals every year. "A lot of the 2,500 titles will come from India," said Mr Manas Saikia, Managing Director, Cambridge University Press India Pvt Ltd. (Business Line)

At $6.5 million, the Cambridge University Press thought it was a steal. On Tuesday, the world's oldest publisher bought over a young (only 14-years-old), little-known textbook publishing house in Delhi, Foundation Books, for possibly the highest price ever paid to an Indian publisher, big or small. Foundation's Manas Saikia gets a whopping $4.5 million for his list of 100 titles (plus 290 in the pipeline), six offices and his school and college connections. CUP is planning to invest the rest of the $2 million in business expansion. And this, says CUP chief Stephen Bourne, is only the start of its buying spree. They're looking out for other houses with "similar interests".

CUP is not the only Western publisher eyeing the thousands of small publishers in English scattered across India. There are several reasons why the West is looking for mergers in India, the world's second largest market for English books, says Bourne. One is affordability—a similar buyover in UK would cost four times what CUP paid. The other is their experience and penetration into the lucrative market for textbooks. But does this mean book prices will soar? Very likely, say insiders, because while the number of English books we produce is only next to the US, in value terms we're way behind even Japan and Korea. (Outlook)

''India publishes 20,000 new titles every year which indicates that the publishing industry is really flourishing in this country and with Cambridge tying up with Foundation Books, the former which saw a sales of Rs 25 crore last fiscal is likely to see a profit of Rs 40 crore,'' said Cambridge University Press Managing Director Manas Saikia. Foundation Books at present publishes the Journal of India Foreign Affairs and with the tie-up in place CUPI plans to launch more journals from India. CUP said that it had already acquired the Journal of Asian Studies and several journals of the Commonwealth Agricultural Bureau. Foundation Books which has been the strategic partner of Cambridge University Press looks after CUP's interests in South Asia including handling the markets of Sri Lanka, Bangladesh, Nepal, Pakistan, Maldives and Bhutan. (Webindia)

"We would work with authors based here and publish books and journals on subjects such as IT and agriculture, which have a direct bearing on the Indian readers," Mr Chris Boughton, MD, Asia Pacific said, adding that books published in India would also cater to markets in the Arab nations and Africa, where the company is looking to increase its presence.

Cambridge also sees a great scope for its English language teaching (ELT) books in the domestic market, given the emphasis laid here on good communication skills. "We have also come out with a book on English for call centres and foresee great demand for it in India," Mr Boughton said. (Biznews)

Bourne identified opportunity in the Indian market as the biggest factor for Cambridge University Press to make a foray into the country. While in the UK, there’s hardly any scope to grow any further, he said. “Growth is in such places as India,” he added. China also offers opportunity, but the regulations of that country are restrictive, according to company executives. In China, foreign publishers cannot operate directly.

Admitting that Oxford University Press is the biggest competition around, the Asia-Pacific managing director of Cambridge Univesrity Press Chris Boughton said that the company’s India venture would aim at becoming the top player in this market. He, however, did not offer any timeframe for meeting the target. The market size of Oxford is estimated at six times that of CUP’s India partner, Foundation Books, in India, according to industry estimates. (DNA)

[CUP] will focus on customising a special type of English for call centres and BPOs as there are growing employment opportunities for those wishing to join this booming industry, CUP chief executive Stephen RR Bourne told said. "It's mainly going to be about vocabulary and the structure of sentences. The idea is also to familiarise them with geography of different places in the world so that it doesn't matter which part of the world they are catering to," he maintained.

English language courses contribute a third of the nearly Rs 12 billion annual revenue of the 425-year-old publishing house that has published books by iconic figures like Isaac Newton, John Milton and, more recently, Amartya Sen. (Yahoo India)

"Till yesterday, CUP worldwide had only two bookshops, one at Cambridge and the other at Sao Paulo in Brazil. But from today we have eight bookstores worldwide," states the Englishman (Stephen R.R. Bourne, President of CUP). Six Indian cities - New Delhi, Mumbai, Hyderabad, Bangalore, Chennai and Kolkata - get a bookstore each. "Ninety per cent of the books in these stores will be Cambridge books but it shall have books by other publishers too," he says.

Bourne says, "Indians are lucky to have so many bookstores." The prevailing international trend is Internet-shopping of books. "Quite a hefty percentage of our books is sold through Internet worldwide. A website like Amazon.com gives us a lot of business. But the trend will take some time to grow in India," he feels. A time would come, he says, "when there shall be no bookstores in the world. Say, in another 10 to 20 years, no one will visit a bookstore for books. It will finally see the end of stand-alone colony bookstores."

Sharing as to why his company is showing greater interest in the Indian market now, Bourne says time has come now for Cambridge books to expand its prospect. "English language books have been our plus points. English education is indeed big in India and our academic books are already quite popular here. But we need to expand and to do that you need to pump in money which we will do now after the new equation," he explains. India is the third largest market for English language books after the U.K. and the U.S. but in a span of few years, India is slated to beat even Britain in the race. No wonder, foreign publishers are increasingly setting shop in the country.

"Easy English language books for early learners are not widely available here. We have started our language books section for early learners in New Zealand called Hippo Books. We might think of bringing the range here," he says.

Though CUP is the oldest publisher of Bible, (the first one was published in the 15th Century) this looks like the last of his priorities here. "My first priority here is to sell English grammar and maths books to Indian school-goers," he sums up. (The Hindu - July 27, 2006)

It's not the huge number of English-speaking population alone that has attracted the Press, which presently outsources typesetting of whole of its books and 90 per cent of journals to companies in Delhi, Bangalore, Chennai and Pondhicherry. India's edge in software technology and low cost of publishing makes perfect business sense for the Press.

The Press, whose annual revenue is about $250 million, currently brings out 2,500 titles a year, which would now become available in India with the Cambridge University Press India Private Ltd coming into existence. (Rediff)

Frontline (Feb 2006) carried an interview with Manas Saikia, formerly owner of Foundation Books and now Managing Director of CUP India. Saikia laments the lack of a global vision amongst Indian publishers.

There is only one true Indian multinational, Roli Books. They have a true international approach and market. Believe it or not their biggest market is the French one. Most Indian publishers who have made good, such as S. Chand, Navneet or MBD, invest their profits in property or hotels such as Hotel Tourist in Delhi, Atlantic in Chennai, MBD Radisson in Noida and MBD Airport Hotel in Kolkata. Hence these people, who have the money to go global, do not do so. That is a pity. However, please note that India has become a global leader in digital origination. There are companies such as Tech Books in Delhi, DBS in Pune, e-Macmillan in Bangalore, Intergra in Chennai and so on who employ thousands of people for typesetting and uploading. Homegrown Indian publishers complain about the import of books and loss of foreign exchange. The truth is that international publishers are buying much more out of India than the books that are being imported. At the London Book Fair, there is a "Production" section. If you go there you will find most exhibitors are Indian printers for digital service providers.